EU farm ministers agree new rural development strategy

EU FARM ministers have agreed a new rural development strategy for 2007 to 2013, designed to bolster the so-called “second pillar” of the CAP.

Most of the debate at yesterday’s council in Luxembourg focussed on how to allocate funds between the three priority “axes” of the new policy.

The commission had originally proposed that at least 15% should go to Axis 1 (improving rural competitiveness), 25% to Axis 2 (managing the land) and 15% to Axis 3 (rural employment and diversification).

But the final decision ended with ministers allocating a minimum 10% to axes 1 and 3, and 25% to axis 2.

The final deal also requires member states to pay at least 5% of their funds into LEADER projects, except in the new member states which only have to pay 2.5%

The accord was welcomed by EU agriculture commissioner Mariann Fischer Boel, who told journalists she was proud to be associated with a council of 25 ministers who had acted so decisively.

“I’m very impressed by the co-operation, by the collaboration and by the solidarity of member states to show that the EU is still alive and is not a lame duck.”

But grave doubts remain about the level of funding, following the failure of EU heads of state to agree a new budget at their summit in Brussels last week.

The commission had proposed that €89bn (£60bn) be made available for the seven-year period, topped up with another €9bn (£6bn) of modulation cash.

But the proposal tabled by the Luxembourg presidency last week before heads of state stomped off home suggested just €74bn (£50bn) be allocated to rural development.

Mrs Fischer Boel acknowledged that “the cake will be smaller”, but pledged to do everything she could to keep the cuts as small as possible.

She also hinted at using modulation to raise more funds for rural development from 2008.

“From my point of view, modulation is an important tool to try and meet the demands of taxpayers,” she said.

Despite the agreement on the allocation of funds between policy axes, no deal was made on how to allocate those funds between member states.

That is likely to be left to heads of state to decide once they agree a total EU budget.

The vexed question of redefining the less favoured areas (LFAs) has also been delayed to 2010.